Wall Street suffered yesterday despite jobless claims that were better than most analysts had expected. The NASDAQ dropped by more than 1 percent (1.07 percent, 22.85 points). The Dow Jones (0.74 percent, 74.25 points) and S&P 500 (0.77 percent, 8.11 points) also dropped to a lesser extent.

According to CNNMoney.com, stocks are poised to jump this morning as investors hedge bets on updated GDP numbers to be released later today. Markets will also likely turn on key issues addressed by Federal Reserve chairman Ben Bernanke during his policy speech in Jackson Hole, Wyoming.

Unfortunately, according to MarketWatch, though futures may rise and markets may jump in the morning it will take outstanding news on GDP or Fed policy to reverse the overall negative trends in financial markets. Too many Americans remain worried about the long and short-term trajectory of the greater U.S. economy.

Reuters reports that Wall Street currently hovers at just about a 7-week low. Bad news today could mean financials close the week down yet again.

According to Bloomberg News, the annual Fed policy meeting in Jackson Hole may be the fulcrum in divergent opinions between American and European bankers. Chairman Bernanke and president Trichet, the respective heads of the world’s most influential central banks, seem headed in opposing directions.

In the U.S. the Fed wants to combat the menace of deflation at all costs. In Europe, the central bank looks to keep inflation in check. The European model seems to be working in Germany.

Germany is a top-five global economy with large entitlement and social welfare programs, stable employment, and robust international trade. The country also does whatever it can to maintain surplus or parity with its trading partners – a concept completely lost on the United States. Instead of worrying about the invisible menace of deflation, the European Central Bank looks to tackle the problems it can see. The biggest problem is overspending and inflation.

European governments have no problem with spending money. What they abhor is wasting it. In the U.S. both parties look to shell out as much cash as possible during their tenure in power to buy political favor. In Europe, which has not been as lavishly successful in the past century as the United States, when the government spends money the spending is direct and focused.

The ECB now wants to exit its financial stimulus and bailouts because they are no longer worth the cost. Meanwhile, the Fed hopes to continue its undirected stimulus handouts and impossibly low lending rates. One side has to give, and at this time Europe seems to clearly have the upper hand.

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